Russia’s currency lost a third of its value against Bitcoin on Monday, while also tumbling to the dollar after the United States blocked several banks from global financial markets.

The exchange rate shot up by more than 30% to nearly 4.3 million ruble per bitcoin, data from Coingecko showed. The ruble depreciated in a similar range against most altcoins.

The weakening ruble likely indicates that Russian entities are buying crypto in the face of extreme volatility. Limitations on Russia’s foreign exchange reserves, placed by the West, are likely to ramp up inflation, and stifle economic growth in the country.

Graph showing ruble crashes against bitcoinRuble at three-month lows against BTC

The United States over the weekend moved to block several Russian banks from the SWIFT transaction system, over the invasion of Ukraine. Much of Russia’s overseas holdings were also frozen.

In another blow to sentiment, Russian President Vladimir Putin ordered the country’s nuclear deterrent forces to be on high alert.

Most major tokens retreated against the dollar, while stablecoins continued to see high demand.

 Russia faces sanctions shock

The sanctions knocked the ruble to a record low against the U.S. dollar, and saw the Russian central bank raise its benchmark interest rate to a record-high 20%, as damage control.

Reports show Russian citizens forming long lines outside ATMs, on fears that banks could limit cash withdrawals. In Ukraine, citizens were seen piling into dollar-pegged stablecoin Tether, after the country’s central bank suspended electronic cash transfers.

Amid increasing economic restrictions, speculation has been rife over whether Moscow will adopt crypto to bypass western sanctions. As it stands, there is no effective method for regulators to block peer-to-peer transactions.

Russians already hold 12% of the world’s crypto. And with mining also set to boom in the country, widespread adoption may not be such a foreign concept.

Still, limitations on technology imports could hurt Russia’s mining industry.

It is also unclear how major crypto exchanges will be able to function in Russia with the recent sanctions. Currently, Binance and Kraken are among the largest operators in the country.

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